- Broadcom slumped 14% premarket after its AI semiconductor revenue forecast for the current quarter disappointed, reversing most of the $150 billion in market cap it had added this week.
- Nasdaq 100 futures fell 1.1%; CrowdStrike dropped 10% despite raising its revenue forecast; South Korea’s Kospi fell 1.8% as the tech selloff spread to Asia.
- SpaceX confirmed it’s seeking to raise $75 billion in an IPO targeting a $1.77 trillion valuation; the share sale is set for June 11 with trading expected to begin June 12.
- Blackstone limited redemptions from its flagship private credit fund for the first time after investors sought to pull 10% of shares, joining a growing list of funds capping withdrawals.
What Happened?
Global markets turned lower Thursday after Broadcom’s quarterly AI revenue forecast fell short of investor expectations, triggering a broad technology selloff. Broadcom, which had added roughly $150 billion in market cap just this week, fell 14% in U.S. premarket trading. Nasdaq 100 futures dropped 1.1%, with the selloff spreading to Asia — South Korea’s Kospi fell 1.8% — while Europe’s Stoxx 600 rose modestly, reflecting tech’s smaller weighting on the continent. CrowdStrike fell 10% even after raising its revenue forecast. Separately, SpaceX confirmed its long-anticipated IPO, filing with the SEC to raise $75 billion at a nearly $1.77 trillion valuation; trading is expected to begin June 12. Blackstone also disclosed it had limited redemptions from its flagship private credit fund after investors sought to pull 10% of shares.
Why It Matters?
The Broadcom miss crystallizes a growing anxiety about AI trade valuations. “Valuations are looking slightly frothy in pockets of the market which have seen the strongest gains over recent weeks,” said Wolf von Rotberg of Bank J Safra Sarasin. The Philadelphia Semiconductor Index has essentially matched its 1999 peak-year performance, a comparison that makes strategists nervous — that rally ended with an 18% decline through late October 1999. Meanwhile, the macro backdrop is complicating the picture: Treasuries rebounded Thursday, with the 10-year yield dipping to 4.45%, but markets are increasingly pricing an oil-driven Fed rate hike as soon as October. Rising bond yields are a particular threat to growth stocks valued on long-term earnings projections.
What’s Next?
Friday’s payrolls report is the next major test for markets — weekly jobless claims rose more than expected Thursday, suggesting early signs of softening. The SpaceX IPO roadshow will dominate headlines into next week. TSMC’s CEO warned this week that global chip supply will fall short of AI demand “for years to come,” which may limit the damage from Broadcom’s miss. The Blackstone redemption cap adds another datapoint to the private credit stress narrative building across the alternatives industry. All eyes are now on whether Friday’s jobs print provides cover for the Fed to hold — or locks in the rate-hike scenario markets have been fearing.
Source: Bloomberg
